LONDON -- Ethiopia's rebel factions agreed to a cease-fire yesterday at U.S.-sponsored peace talks, possibly clearing the way for formation of a provisional government and long-term moves toward democracy after decades of civil war.

Immediately after the breakthrough, the chief U.S. negotiator, Herman Cohen, urged the largest rebel group surrounding Addis Ababa to take control of the Ethiopian capital "as soon as possible to help stabilize the situation."

Shortly afterward, Ethiopia's state radio quoted the military high command as calling on the army to lay down its weapons and said the interim government was preparing for speedy creation of a government composed of all opposition groups.

Early today, thousands of rebels poured into Addis Ababa from all directions and launched an assault on remnants of the army at the presidential palace, eventually gaining control of the compound, Reuters reported rebels as saying.

The cease-fire was arranged by Mr. Cohen, assistant secretary of state for African affairs, at the opening of peace talks between Ethiopia's prime minister, Tesfaye Dinka, and three major rebel organizations.

Mr. Cohen said the United States recommended that forces of the Tigrean-dominated Ethiopian People's Revolutionary Democratic Front enter Addis Ababa "to reduce uncertainties and eliminate tensions in the city." He called on "all parties on the ground in Addis to cooperate in maintaining law and order."

Until yesterday, the Bush administration had urged rebel forces to stay out of the capital to avoid further civilian bloodshed.

The front, the largest rebel group, began fighting the government in 1975. It is an umbrella movement dominated by Tigrean insurgents,ho say they want democracy and free elections in their Horn of Africa nation.

Reports from the Ethiopian capital suggested it was on the brink of collapse and that total chaos could result unless swift action were taken.

The EPRDF, which was surrounding the city and which had closed its airport, gave the interim government an eve-of-talks ultimatum Sunday: Surrender within 48 hours or be "crushed." The faltering government was less than a week old. It replaced the 17-year-old regime of President Mengistu Haile Mariam, who fled to Zimbabwe last week in the face of looming defeat after decades of civil war and famine.

Mr. Cohen told reporters at the central London hotel where the talks opened that the EPRDF's delegation, led by Front chairman Meles Zenawi, had assured him that they supported formation of a broadly based provisional government leading to a democratic constitution.

But outside the hotel, demonstrating Ethiopian exiles tore up a copy of the cease-fire announcement and expressed angry doubts about the power it bestowed on the EPRDF.

A spokesman for the pressure group Ethiopians Against the War, which has campaigned for democratic reforms, said: "The group that is now marching to Addis Ababa is an unrepresentative group composed of die-hard Marxists of the Albanian type.

"They won't want to include the democratic coalition that has been fighting . . . against Mengistu. This will lead to a short-lived peace. In the long run, in our view, it is like asking Ethiopia to sign its death warrant."

"The EPRDF does not represent the Ethiopian people," said another demonstrator. "They got there by killing people as bad ++ as the government. They believe in killing like Mengistu. They are not good for us."

The other rebel groups involved in the negotiations were the Eritrean People's Liberation Front and the Oromo Liberation Front.

A central problem for Mr. Cohen in building on the immediate cease-fire will be to reconcile the different aims of the rival groups, which are split across political, religious and geographic lines.

The Eritrean group represents Christian and Muslim communities Eritrea. It is the oldest rebel movement, begun in 1962. The Eritreans have fought for secession of their province, but the other rebel groups oppose that policy.

Like the EPRDF, the Eritreans have espoused Marxist tenets but they have recently attempted to project a more moderate image.

The Oromos are calling for autonomy, or at least self-determination, for the largest ethnic group among Ethiopia's million people.

Mr. Cohen was to chair round-table talks today to try to find a formula for stability.